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Having your own DME

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  • Having your own DME

    I just read an article in AAOS Now that talked about ways to increase your income that many doctors are ignoring.  One of them was having your own DME.  I know many private practice doctors do this but they mentioned hospital employed physicians also being able to have their own DME.  Does anyone have experience with being a hospital employed physician but still having DME that you can get income from?  If you haven't noticed I am an orthopedic doctor and we give our tons of braces and right now the brace company bills and collects from our patients but my staff still does all the other work.  Just trying to figure out if there is a better way.


  • #2
    Be very very very careful before you do this. DME companies are covered entities under Stark, which means it is illegal for you and anybody who has a financial stake in the DME company to refer Medicare/aid patients to the DME company. Penalties include nonpayment of any illegal referrals, loss of participation in Medicare/Medicaid, and a $15,000 fine per violation.

    In addition to the potential legal ramifications, the informal conversations I've had with DME reps is that now is a bad time for the DME industry, and ObamaCare changes to DME reimbursement are the culprit. ACA introduced competitive bidding for DME companies to get the right to bill Medicare at all. In my metro area, 5 companies out of about 15 have Medicare bids at any one time, and several of the smaller companies have given up completely because they would lose money on each patient if they won the bid. Food for thought.


    • #3
      WCICON24 EarlyBird
      There has been one on sale in my town and the cash flow/price made no sense, an extremely great buy if thats reality into any intermediately projected future cash flows. Then you have to ask why would anyone sell out of such a lucrative position at such a low multiple...and the reasons are likely what @pulmdoc mentions. DME have probably been taking too big a piece of the pie and are set for some crimped profits. CMS is a whack a mole kind of process, slow but it gets to that outlier eventually.